JPMorgan has reached a preliminary agreement with the Commodity Futures Trading Commission to pay $100 million to settle charges related to the bank's "London Whale" trading losses—a scandal that put Dimon under close scrutiny in Washington and led to a failed effort to strip him of his CEO title.

(Read more: JPM expected toadmit fault in 'London Whale' loss)

"You can't be active in a big business without making some mistakes, and sometimes they may be big ones," Buffett said in a "Squawk Box" interview. "Jamie will survive fine. He knows how to run a bank."

Buffett likened Dimon's leadership prowess to one of baseball's all-time greats. "You have look at the overall record. Babe Ruth hit 60 home runs that one year. I don't know how many times he struck out. I don't care."

In addition to the "Whale" case, regulators are also going after JPMorgan over allegations of sales of shoddy mortgage securities leading up to the 2008 financial crisis. Several of the investigations stem from JPMorgan's fire sale purchases of Bear Stearns and Washington Mutual.

"They probably had a week to look at it. Bear Stearns had hundreds and hundreds of derivatives contracts out," said Buffett, who played a key role in providing cash infusions to other Wall Street financial institutions during the financial crisis.

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JPMorgan's Jamie Dimon

"They loved it when Jamie took over WaMu and Bear Stearns. You could say they should have written different contracts that protected them from all the things that happened in the past. But they wanted to get a deal done. And you needed to get a deal done very promptly or other dominos were going to fall," Buffett said on JPMorgan, a stock he owns.

Last month, Dimon met with U.S. Attorney General Eric Holder in Washington to discuss a possible settlement of those mortgage sales— rumored to be in the $11 billion range.

"If you run a major financial institution, and I did for a very short time at Salomon, and the government is pressing charges," Buffett said, "a large financial institution just can't take that. They have licenses in 50 states, so you are in a terrible negotiating position.

"I've been in that position," he added. "If they want to take a pound of flesh, they're going to take pound of flesh. But if they want to take a ton of flesh, they are can take that, too."